ICICI Direct research report on JK Lakshmi Cement
JK Lakshmi mainly caters to the north, west & eastern markets with total capacity of 13.3 MT (including subsidiary). It has integrated units at Sirohi, Udaipur (Rajasthan), and Durg (Chhattisgarh) while grinding units are located at Jhajjar (Haryana), Cuttack (Odisha), Kalol and Surat (Gujarat). It also has 117 MW power plant (74 MW CPP, 33 MW WHRS, 10 MW solar) that fulfils its 75% of total power requirements • The company is now adding 2.5 MT cement capacity (1.5 MT clinker) through its subsidiary unit UCWL at a cost of ~Rs 1650 crore • The company intends to take its total cement capacity to 30 MT by 2030.
Outlook
Given its comfortable valuations (ie. EV/t of $69/t), we now upgrade the stock from HOLD to BUY despite its sharp rally. We value the company at Rs 780 i.e.8.5x FY24E EV/EBITDA, EV/tonne of $80/t)
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